How to minimise your bank fees when travelling overseas

Long gone are the days of going overseas with a bunch of traveller’s cheques stuffed in your money belt. With the rise of internet banking and ATMs, it’s easy to access your money from anywhere in the world, but it can get expensive. Really expensive. I’ve returned from holidays with hundreds of dollars in international transaction fees. With a bit of forward thinking and organisation, you can keep the costs down.

So, what kind of fees are we talking about?

Simply taking out cash overseas will often result in a fee from the foreign ATM fee (charged by your Australian bank, around AUD$5-$10 per ATM withdrawal), the local ATM operator fee AND a currency conversion fee. If you take out money from the ATM a few times a week, these additional charges add up quickly.

Traveller’s cheques – yay or nay?

Personally I haven’t used them in over 10 years. I can think of a million things I’d rather be doing on my holiday then queuing up in line at the bank to cash my cheques, plus you still have to pay fees on them for the inconvenience. Many stores and hotels in Europe now refuse to accept them as well. Stick to a combination of cash, a travel card and/or a credit card.

Notify your bank you are travelling

To reduce the risk of having a temporary hold placed on your bank account or credit card, always make sure you notify your bank of your plans to travel before you leave. I always remember the time my friend received a phone call whilst we were shopping on the Champs-Élysées in Paris. She had spent so much money on her credit card the bank had called to advise her they believed her credit card was stolen. Nope, just a spot of retail therapy.

Take money out in chunks, but be careful

An easy way to minimise charges when you use an ATM is obviously to withdraw cash less often. When I’m overseas, I generally withdraw money in chunks of the local equivalent of AUD$200-$300. However, carry only the amount that you expect to need for the day and store the rest in your locked suitcase or safe in your hotel.

Consider a prepaid travel card

A prepaid travel card is often a cheaper and safer method of using money overseas, as the card is protected by a PIN and you get a back-up card in case the original card gets lost. While there are some fees associated with travel cards, it’s often significantly cheaper than using your standard high-interest credit card. Do your research using a site like Mozoand find a prepaid travel card that best suits you requirements – pay attention to the currency conversion and reload fees.

Get a travel-friendly credit card

With no currency conversion fees, no international transaction fees on purchases and no annual fee, the 28 Degrees Travel Card is a favourite amongst travellers. Just make sure you apply for it well in advance of departing for your trip. Check their website for more information.